Global Shariah equity funds experienced geographical divergence in Q1 2026, with the IFN Investor Funds Database showing institutional capital moving from Asia Pacific to chase higher-yielding funds elsewhere.
Pakistan faced the brunt of the shakedown in Asia. Its Shariah equity assets contracted almost 8.5% quarter-over-quarter (q-o-q) to reach an AuM of around US$973.5 million in Q1 2026. The decline highlights the intense short-term volatility gripping frontier jurisdictions, culminating in a divergence for a country that still posted a year-on-year (y-o-y) gain of 51.8% between Q1 2025 and Q1 2026.
Even Malaysia wasn’t spared of the phenomenon. The Islamic finance leader saw equity funds AuM slide 2.63% q-o-q to US$15.23 billion, after growing 2% y-o-y.
Saudi Arabia's equity universe rebounded 5.4% q-o-q to reach an AuM of US$13.32 billion, while being virtually unchanged y-o-y. This signaled that even as allocators avoided Pakistan, there was a synchronized institutional preference for deep-pocketed, oil-insulated sovereign corporate liquid assets.
Similarly, Shariah equity funds in energy-rich UAE grew 1.3% q-o-q to US$407.69 million, after a y-o-y advance of 96.6%.
Conversely, Western UCITS platforms and ETFs captured cross-border liquidity surges.
Ireland’s Shariah equity pool jumped 9.49% q-o-q to US$10.72 billion, after posting a 49% growth y-o-y. Luxembourg’s Shariah equity funds witnessed an AuM at US$3.84 billion, up 2.1% q-o-q and 57.4% y-o-y while the UK registered a 6.1% climb q-on-q to US$3.07 billion as y-o-y values jumped by a massive 125.6%.
US Shariah equity funds closed Q1 2026 with total valuation at US$12.36 billion, up 4.7% q-o-q and 47.02% y-o-y.
Global Shariah equity valuation changes by domicile, quarter and year
| Domicile | Q1 2026 AuM (US$ million) | Q4 2025 AuM (US$ million) | Q-o-q change | Y-o-y change |
| Luxembourg | 3,844.7 | 3,765.67 | 2.1% | 57.4% |
| Malaysia | 15,234.58 | 15,646.76 | -2.63% | 1.99% |
| Others | 8,490.89 | 8,103.55 | 4.78% | 30.87% |
| Pakistan | 973.48 | 1,063.69 | -8.48% | 51.77% |
| Republic of Ireland | 10,718.7 | 9,789.34 | 9.49% | 49.03% |
| Saudi Arabia | 13,316.46 | 12,639.38 | 5.36% | -0.03% |
| UAE | 407.69 | 402.39 | 1.32% | 96.6% |
| UK | 3,074.18 | 2,897.99 | 6.08% | 125.57% |
| US | 12,356.5 | 11,804.07 | 4.68% | 47.02% |
Source: IFN Investor Funds Database
Restricted Access
Login to continue reading (existing subscriber)
Subscribe NOW and get:
- Gain unlimited access through all key operating platforms
- Full access to all listed Islamic funds & fund profiles
- Unlimited access to all Islamic fund managers
- Access to all exclusive articles, reports, podcasts & videos
- Complimentary access to all IFN Investor Forums
